Reckoning with the Allocation of Voice and Power in America: A Review of Callahan’s THE GIVERS

Editors’ Note: Kristin Goss continues HistPhil’s book forum on David Callahan’s The Givers.

Michael Bloomberg is a media titan, former big city mayor, and billionaire philanthropist who is deeply worried about global climate change, as well as about the well-funded denialists and business interests hindering action to halt it. In recent years, Bloomberg has pledged $80-million to put coal-fired plants out of business, even if doing so will cost jobs in some of America’s poorest counties.

Bloomberg’s work captures everything that is right – and all that is potentially wrong – with elite philanthropy in an age of inequality and populist backlash. In the “plus” column, we might applaud Mr. Bloomberg for using his estimated $49-billion fortune in the public interest. In particular, we might praise his instincts to do what philanthropy does best: compensate for well-known failures of the market and governance, including the failure to supply public goods that will serve humanity well over the long term. In the “minus” column, we might question a system that allows a big-city billionaire to exercise such power over the livelihoods of people to whom he is not accountable and over communities far removed from his own.

To its credit, Bloomberg Philanthropies, whose flagship foundation dispensed around $280-million in 2015, has granted $3-million to projects in communities affected by coal-plant shutdowns. Michael Bloomberg himself recently argued that America has not done well by its coal miners. Such moral impulses and financial commitments notwithstanding, it’s reasonable to ask how civic-minded billionaires came to exercise such power over the public agenda.

In an important new book, The Givers: Wealth, Power, and Philanthropy in a New Gilded Age, David Callahan takes up this question. Callahan, the founder of the media enterprise Inside Philanthropy, argues that “philanthropy is becoming a much stronger power center and, in some areas, is set to surpass government in its ability shape society’s agenda.” The “power shift” from government to philanthropy, he contends, “is one of the biggest stories of our time.”

Callahan, who holds a PhD in political science, argues that philanthropy’s role has expanded as government’s role has contracted. Political dysfunction and a fiscal squeeze have limited the federal government’s capacity to reach consensus on problems or effectuate solutions. At the same time, economic forces (and public policy) have produced a cadre of billionaires who need to do something with their fortunes. For many of these extremely wealthy individuals and couples, the only logical answer is to give the money away. Nearly 170 of them have made a public pledge to donate the bulk of their wealth in their lifetime, and others have privately committed to doing the same. As Callahan and others including myself have argued, failures of governance have created a space for philanthropic plutocrats to exercise outsized influence.

This vast transfer of wealth from powerful individuals into the public sphere demands that we reckon with the allocation of voice and power in America. The giving surge has reinvigorated longstanding tensions within philanthropy, an enterprise that puts unrepresentative elites in the service of the public good as they define it. The central question is whether philanthropy does more to compensate for social and governmental failures than to exacerbate them.

Callahan explores these themes through various perspectives: billionaires trying to give away their fortunes before they die; children of wealth seeking to build on the family legacy; ideologues trying to change the public conversation; youthful entrepreneurs looking to “disrupt” standard approaches; reformers laboring to fix troubled public systems; women banding together to redress the gender imbalance in organized philanthropy; professional advisors hoping to infuse philanthropy with strategic thinking; and so forth.

Callahan’s is an insightful book. It asks the right questions. It tells a lively story. It proposes policy approaches that might help around the edges. It’s an important work that is certain to inspire public discussion.

Like many works of social science, the study is better at asking questions than developing answers. He suggests a number of policy remedies that seem unlikely given present political realities: greater disclosure of donors, limitations on tax breaks for politically oriented giving and politically active organizations, the creation of a government watchdog, mandated diversity on foundation boards, and even a massive redistribution of wealth. Callahan is to be praised for proposing bold ideas, which all merit attention and debate.

But in the present reality, the fundamental and most pressing question is not necessarily how to regulate what Callahan calls “benign plutocracy.” Rather, the question is whether philanthropy can be a meaningful answer to what ails us. Philanthropy and the civil society sector do some things well: They innovate; they provide spaces for the free expression of ideas; they adopt orphaned causes. In the policy realm, they put novel understandings and approaches on the political agenda and organize constituencies to promote those ideas. But philanthropy is not a substitute for government or the market, and it is those institutions that are failing America.

The 2016 election – and perhaps the “hope and change” election of 2008 – taught us a powerful lesson: Many Americans are disaffected, discouraged, even suffering. Too many cannot find dignified work, which provides security and a ladder to prosperity. They feel that elite institutions, including political leaders, do not listen – and that America is on the wrong track. Without dignified work and a responsive democracy, many Americans are pessimistic that young people can be better off than their parents. Pessimism afflicts white Americans from the small towns and family farms of the “flyover” states (as post-mortems on 2016 have shown), and affects black and brown Americans who still struggle to make a better life than the fields, ghettos, and barrios can offer.

The nation’s top 1000 institutional philanthropies gave away $22-billion in 2012, and individual donors augmented that amount through “checkbook” contributions. Philanthropy contributes greatly to the nonprofit sector of the economy. The big question that underlies Callahan’s excellent book – the question that merits a deeper exploration – is whether the nonprofit sector and its phenomenally wealthy and largely public-spirited patrons represent the right approach to problems of income inequality, cultural division, and dysfunctional democracy.

Michael Bloomberg has pledged $80 million to shut down the coal industry, a contribution that will help meet the existential threat of global climate change. To his credit, Bloomberg’s philanthropy chipped in $3 million to begin to offset the effects of job loss. But $3 million is chump change. It doesn’t begin to address the core problem, which is the vastly unequal distribution of opportunity and dignity in today’s America.

-Kristin A. Goss

Kristin A. Goss is Associate Professor of Public Policy and Political Science at the Sanford School of Public Policy at Duke University. Her books and articles focus on social movements, citizen groups, and philanthropy. Follow @KAGoss.